Central District Consumer Bankruptcy Attorney's Association

Cash Collateral
This may be a weird question, but were there cash collateral issues in your
case? One thing you can do, although I'm not smart enough or experienced
enough to actually try it, is to "concede" that a cash collateral issue
exists and do a motion for cash collateral or stipulate to its use.
I think there is a strong argument that if the lender wants rents
segregated, then they are secured by more than the residence.
Looking at Lievsay, I see:
"Thus, although the debtor argues the language of the deed of trust 709 *709
demonstrates that its reach is greater than a security interest in his
residence alone, he has not shown that to be the case.[8]"
"[8] While it is true that, were a gold mine to be developed on the subject
property, the bank would doubtless assert a collateral interest in it, there
is no indication of the possibility that such an interest might exist."
Language of Deed
If you look at the deed of trust and accompanying note, somewhere, you'll
find that they try to attach everything. Although I joined this particular
case late, I made an appearance for a disclosure statement where the bank
objected to plan treatment, the lender's attorney said that they believed
cash collateral might be being used w/o their permission (on debtor's
primary residence which is now being used as rental property) - the judge
asked why they had waited this long to bring up the issue and shut her up.
Afterwards, I told her that the loan was a residential one, and therefore
there were no cash collateral issues. Her response was (maybe making it up)
that their deed of trusts now attach to all sorts of things, including
rents.
My point is, look and see what they are attaching to; maybe it's such a wide
net that you can circumvent 1123(b)(5).
Sincerely,
Michael Avanesian Esq.
michael@avanesianlaw.com
818-817-1725

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Understood and thanks. But even McVey made its finding based on
the fact that the lender was aware of the multiple uses of the
property at the time the loan was made. Doesn't look good for my
case...
*************************
Mark J. Markus
Law Office of Mark J. Markus
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)509-1460 (fax)
web: http://www.bklaw.com/
Certified Bankruptcy Law Specialist--The State Bar of California
Board of Legal Specialization
This Firm is a Qualified Federal Debt Relief Agency (see what this
means at

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BTW, when I said it was the only one of which was aware, I meant that it
could be used in your situation because I certainly have read most of the
others mentioned, especially since some were included in the opposing
creditor's briefs.
On Tue, Aug 21, 2012 at 1:31 PM, Giovanni Orantes wrote:
> *In re McVay, *(Bankr. D. OR. 1993) 150 B.R. 254, the issue in this case
> was whether a Chapter 13 Plan can modify the contractual rights of a
> creditor whose claim is secured by real property which is *not* only the
> debtors principal residence, but also generates substantial income for the
> Debtors.
>
> McVey is the only one of which I'm aware. Please send me whatever you can
> find on this, too, as I am in front of Judge Zurzolo on this issue in two
> days.
>
>
>
BTW, when I said it was the only one of which was aware, I meant that it could be used in your situation because I certainly have read most of the others mentioned, especially since some were included in the opposing creditor's briefs.
On Tue, Aug 21, 2012 at 1:31 PM, Giovanni Orantes <go@gobklaw.com> wrote:
In re McVay, (Bankr.
D. OR. 1993) 150 B.R. 254, the issue in this case was whether a Chapter 13 Plan
can modify the contractual rights of a creditor whose claim is secured by real
property which is not only the
debtors principal residence, but also generates substantial income for the
Debtors.McVey is the only one of which I'm aware. Please send me whatever you can find on this, too, as I am in front of Judge Zurzolo on this issue in two days.

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Hey Mark,
I assume you are talking about a cramdown under the exception to the anti-modification clause of 1322(b)(2). See In re Scarborough, 461 F.3rd 406 (3d Cir.Pa.); In re Lievsay, 199 B.R. 705 (9TH Cir BAP 1996); In re Ramirez, 62 B.R. 668 (Bankr.S.D.Cal. 1986); In re Reyes, 2009 Bankr. LEXIS 4021 (Bankr..W.D. Wash 2009); In Re Beamon, 298 B.R. 508 (N.D.N.Y. 2003).
Shannon A. Doyle
Attorney at Law
100 N. Barranca Avenue, Suite 250
West Covina, CA 91791-1600
Tel: (626) 646-2555
Fax: (626) 332-8644
www.blclaw.com

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Thanks. Strange dearth of cases out there on this issue.
*************************
Mark J. Markus
Law Office of Mark J. Markus
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)509-1460 (fax)
web: http://www.bklaw.com/
Certified Bankruptcy Law Specialist--The State Bar of California
Board of Legal Specialization
This Firm is a Qualified Federal Debt Relief Agency (see what this
means at

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*In re McVay, *(Bankr. D. OR. 1993) 150 B.R. 254, the issue in this case
was whether a Chapter 13 Plan can modify the contractual rights of a
creditor whose claim is secured by real property which is *not* only the
debtors principal residence, but also generates substantial income for the
Debtors.
McVey is the only one of which I'm aware. Please send me whatever you can
find on this, too, as I am in front of Judge Zurzolo on this issue in two
days.
In re McVay, (Bankr.
D. OR. 1993) 150 B.R. 254, the issue in this case was whether a Chapter 13 Plan
can modify the contractual rights of a creditor whose claim is secured by real
property which is not only the
debtors principal residence, but also generates substantial income for the
Debtors.McVey is the only one of which I'm aware. Please send me whatever you can find on this, too, as I am in front of Judge Zurzolo on this issue in two days.

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You're correct Pat, and McVay did address that issue, but found that
where the lender knew of the mixed use purpose at the time of
granting the loan, that is a significant factor in determining
whether the property is determined to be a principal residence or
not, for purposes of lien stripping....
*************************
Mark J. Markus
Law Office of Mark J. Markus
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)509-1460 (fax)
web: http://www.bklaw.com/
Certified Bankruptcy Law Specialist--The State Bar of California
Board of Legal Specialization
This Firm is a Qualified Federal Debt Relief Agency (see what this
means at

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In my case there's no question but that it's the debtor's principal
residence. It's also a rental property. What Shannon just sent was
very helpful. The Lievsay case (BAP) found that using a home as a
home office is not sufficient to defeat the provisions protecting
secured creditors on a principal residence from modification.
Lievsay is a Chapter 11 case (as is mine) so that was very
instructive, although unfortunately not the holding I was hoping
for. Will dig deeper.
*************************
Mark J. Markus
Law Office of Mark J. Markus
11684 Ventura Blvd. PMB #403
Studio City, CA 91604-2652
(818)509-1173 (818)509-1460 (fax)
web: http://www.bklaw.com/
Certified Bankruptcy Law Specialist--The State Bar of California
Board of Legal Specialization
This Firm is a Qualified Federal Debt Relief Agency (see what this
means at

The post was migrated from Yahoo.